Thursday, May 22, 2008
Supreme Court to Rule on Application of Sister State Statute of Repose
By a MetNews Staff Writer
The California Supreme Court yesterday agreed to decide whether another state’s statute of repose may be applied to a claim by a longtime California resident against a defendant based in a third state.
The justices, at their weekly conference in San Francisco, voted 5-2 to grant review of the Feb. 28 ruling of Div. Eight of this district’s Court of Appeal in McCann v. Foster Wheeler, 160 Cal.App.4th 689.
The lower panel reinstated a suit by Terry McCann and his wife against manufacturer Foster Wheeler. McCann, a California resident since 1975, contends that his asbestos-related cancer, or mesothelioma, is a result of exposure during the installation of a boiler in Oklahoma 50 years ago.
Foster Wheeler, a New York company, allegedly designed and manufactured the boiler, which was installed at the Oklahoma refinery where McCann worked in the late 1950s. McCann’s condition was diagnosed in 2005.
Chief Justice Ronald M. George voted to hear the company’s appeal, as did Justices Kathryn M. Wedegar, Marvin Baxter, Carlos Moreno, and Carol Corrigan. Justices Ming Chin and Joyce L. Kennard voted to leave the Court of Appeal decision standing.
Los Angeles Superior Court Judge Jon Mayeda—now retired—granted summary judgment in favor of Foster Wheeler based on the Oklahoma statute of repose. The law bars tort claims for injury arising from “the design...of an improvement to real property” more than 10 years after substantial completion of the improvement.
In doing so, Mayeda rejected the plaintiffs’ contentions that California choice-of-law rules, as well as the California borrowing statute, preclude application of Oklahoma law to the case, and that the Oklahoma statute was inapplicable in any event because Foster Wheeler was not the designer of a real property improvement.
But Presiding Justice Candace Cooper, writing for the Court of Appeal, agreed with the plaintiffs that California’s interest in protecting state residents who are tort victims and whose claims are filed within the period of the statute of limitations outweighs any interest of Oklahoma’s, particularly since Foster Wheeler does business worldwide and has no particular ties to Oklahoma.
“California’s interest is reflected in its statute of limitations governing civil actions based on exposure to asbestos. The statute protects persons injured by exposure to asbestos by permitting them to bring an action within a year after suffering a disability from the exposure....No matter how long ago the person was exposed, the statute provides that the person will have a remedy when the injury manifests itself. In addition, by virtue of its borrowing statute, California has expressly indicated that, even if a cause of action arose in another state, a citizen of California should not necessarily be subjected to the time limitations of the other state.”
The Oklahoma Supreme Court, Cooper noted, has held that the statute of repose serves that state’s interests by establishing “a balance between the rights of claimants and those of the architects and builders” and “providing for a measure of security for building professionals whose liability could otherwise extend indefinitely.”
Foster Wheeler, the presiding justice explained, merely supplied the boiler to an Oklahoma purchaser and supervised its installation. “Foster Wheeler is not a citizen of Oklahoma, and is therefore not among the defendants in whose favor Oklahoma’s statute of repose is primarily directed,” Cooper wrote.
The jurist also rejected the defendant’s argument that California had no interest in applying its laws to “wholly foreign conduct,” noting that the conduct “resulted in an injury to a California resident, which manifested itself in this state.”
In other conference action, the justices agreed to decide whether the final adjudication on the merits of a loss-of-consortium claim results in a res judicata bar of a subsequent wrongful death action for loss-of-consortium damages arising from the same injury. This district’s Div. Five answered that question in the affirmative on Feb. 11 in Boeken v. Philip Morris USA, Inc., 159 Cal.App.4th 1391.
That case involved a wrongful death action brought by the widow of Richard Boeken. The decedent won a $55.5 million judgment, including $50 million in punitive damages, but Judy Boeken’s consortium claim, brought as part of that action, was voluntarily dismissed with prejudice.
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